Credit Management magazine May2017

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OPINION “We have an excellent reputation and need to work with partners who understand us, and who understand the leisure industry” FIT FOR PURPOSE Les Clisby reports on how one of the UK’s best-known fitness brands is managing overdue members’ fees. MANAGING the expectations of members of one of the UK’s leading health and fitness groups, David Lloyd Clubs, is a daunting challenge. Giving exceptional levels of member service and continually demonstrating value for money are critical not only to attracting new members, but also to retain the existing membership numbers. With 83 clubs in the UK, more than 486,000 members, collecting fees can be a delicate balance, especially when a payment becomes overdue. Finding this balance becomes more delicate still once a payment moves from being overdue to an actual debt that requires recovery, and the need for third-party support. Steve Empson, Group Central Membership Manager, is the man tasked with satisfying the Group’s commercial needs, without adversely impacting its reputation. Steve set up the collections team from scratch, using credit industry trade shows to gain insight into the latest collection methods, technologies and techniques and establishing new processes to be deployed in-house. For the first 30 days, outstanding debts are managed within his team, before being outsourced to a specialist provider, ARC (Europe), with whom Steve has worked for more than ten years. “The accounts we outsource have already gone through our collection process, and any disputes identified, so the ARC team receives a ‘clean’ list that helps to avoid any misunderstandings or the likelihood of complaints,” he says. “Although our debt is not regulated by the Financial Conduct Authority, we benchmark our own in-house team and our external partners by the standards the FCA has set in terms of offering forbearance and Treating Customers Fairly (TCF), and this similarly helps keep complaints to a minimum.” Importantly, Steve explains, his team has a much wider role than just debt recovery, and therefore a much wider appreciation of customer engagement. Membership satisfaction and retention is of the utmost importance to David Lloyd Clubs and in working with ARC, he similarly expects that same level of positive interaction, re-engaging and re-habilitating members wherever possible. “Debt management in a members focused business like David Lloyd Clubs needs to be dealt with sensitively. Sometimes a debt is the result in a change in the individual’s personal circumstances, but it might also be that they have moved address without telling us, and we have been unable to connect. In all cases, we are transparent: members are informed that they will be contacted by our administrative partners, ARC, and sometimes the intervention of a third party in itself is enough for a payment to be received.” Steve measures both his in-house team and external providers using a balanced scorecard and recording all calls. They also meet in person at regular intervals, to review best-practice and share common experiences. In exceptional cases, a further tier of doorstep collections can be used, and even litigation, but only ever as a last resort. In terms of his relationship with ARC, Steve says that the key to their longevity has been trust: “We have an excellent reputation and need to work with partners who understand us, and who understand the leisure industry,” he continues. “Because ARC also works with banks, and is FCA authorised, we have been able to benefit from the new standards being demanded. “Working with ARC means that our members are being given the same fair treatment they would receive from my own team, and we are able to maintain one of the best retention rates in our industry.” Les Clisby is a freelance business writer 40 May 2017 www.cicm.com The recognised standard
SECTOR REVIEW – FITNESS AND SPORTS FACILITIES The following data, compiled exclusively for <strong>Credit</strong> <strong>Management</strong> by dun & bradstreet, is drawn from two primary industry sectors – Fitness Facilities and Sports Facilities. (Additional commentary by CICM Think Tank member, Mark Preston MCICM.) For March 2017 there were 1,377 businesses in this database – the analysis covers the period April 2016 to March 2017 and volumes are in the range 1,200-1,400 each month (representing businesses with sufficient payment data to count). Businesses with 25 or less employees pay more promptly than larger businesses. About 1,000 of the 1,377 in March 2017 (73 percent) had prompt payments between 35 and 40 percent. This compares to larger businesses with over 250 employees making prompt payments averaging about 15 percent. This seems to support the understanding that small businesses generally pay better than larger businesses and the consequent issues that this can cause the smaller suppliers. In general, across the 12 months, smaller businesses outperform their larger counterparts by making payments promptly significantly more often (over double the percentage). At a regional level, Yorkshire and the North outperforms the rest of the UK, with the West Midlands, Greater Manchester and Northern Ireland making the fewest percentage of payments promptly. Overall across the Gym and Leisure Industry the last 12 months has seen a decline in the percentage of prompt payment by nearly nine percentage points, with Fitness Facilities performing more poorly than Sports Facilities. This seems to be a general trend not limited to the larger businesses. “Although our debt is not regulated by the Financial Conduct Authority, we benchmark our own in-house team and our external partners by the standards the FCA has set in terms of offering forbearance and Treating Customers Fairly (TCF), and this similarly helps keep complaints to a minimum.” “Working with ARC means that our members are being given the same fair treatment they would receive from my own team, and we are able to maintain one of the best retention rates in our industry.” The recognised standard www.cicm.com May 2017 41
Page 1 and 2: CREDIT MANAGEMENT CM MAY 2017 £10.
Page 3 and 4: CONTENTS MAY 2017 www.cicm.com REGU
Page 5 and 6: 0101100 1101010
Page 7 and 8: CICM WINS APPROVAL IN NEW APPRENTIC
Page 9 and 10: NEWS CREDIT WEEK PROMOTES IMPORTANC
Page 11 and 12: NEWS EXTRA Dominic Saville, Group C
Page 13 and 14: Notall credit collection systems ar
Page 15 and 16: THE B2B DEBT RECOVERY SPECIALISTS T
Page 17 and 18: WEIGHING UP THE ACCREDITATION WEIGH
Page 19 and 20: OPINION DESPITE much speculation, n
Page 21 and 22: INTERVIEW EXERCISING MINDS Sean Fea
Page 23 and 24: "We want to do more of what we’re
Page 25 and 26: We could pay you on your customers
Page 27 and 28: TRADE TALK EXPORT OPTIMISM Lesley B
Page 29 and 30: MOTHER’S RUIN BRITISH booze is br
Page 31 and 32: DO YOU KNOW THE TRUE IDENTITYOF YOU
Page 33 and 34: OUT OF CONTROL? The advice sector i
Page 35 and 36: TECHNICAL BRIEFING GAME CHANGER STE
Page 37 and 38: SHERIFF’S ROLE? The Sheriff has f
Page 39: e 0South 1West 2 3 4 59.3 6 7-2.6 8
Page 43 and 44: THE PERFECT VENUE FOR THIS YEAR’S
Page 45 and 46: CICM EDUCATION CONFERENCE 2017 22 J
Page 47 and 48: Discover what apprentices are sayin
Page 49 and 50: OPINION CELEBRATING CREDIT PROFESSI
Page 51 and 52: EXAM RESULTS Congratulations Congra
Page 53 and 54: PARTNERS TO TALK TO YOU... Safe’s
Page 55 and 56: BRANCH NEWS 60SECONDS WITH NORTH EA
Page 57 and 58: ACCOUNTS RECEIVABLE ADMINISTRATOR G
Page 59 and 60: Cr£ditWho? CICM Directory of Servi
Page 61 and 62: Cr£ditWho? CICM Directory of Servi
Page 63 and 64: MONTHLY PRIZE CROSSWORD CREDIT CONU

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